Opening Comment — Friday, August 01, 2025
DJIA: 44,130.98, down 330.30
S&P 500: 6,339.39, down 23.51
NASDAQ: 21,122.45, down 7.22
Stocks lower following tariff updates
Stock futures are lower Friday morning following President Donald Trump increasing many tariff rates, including a 35% tariff on Canadian imports not covered by the U.S.-Mexico-Canada trade agreement. In terms of economic data, investors are awaiting the July jobs report and manufacturing purchasing managers’ index (PMI) from the Institute for Supply Management (ISM). As of 7:17 AM ET, the Dow is decreasing 0.9%, while the S&P 500 is down 1.0%. The Nasdaq 100 is falling 1.1% relative to fair value on the GLOBEX.
U.S. equities were mostly lower on Thursday as the core Personal Consumption Expenditures Deflator, the Federal Reserve’s (Fed’s) preferred gauge of inflation, rose 0.3% month over month (MOM), as expected, but above forecasts year over year (YOY) with a 2.8% increase following upward revisions to the prior month. June’s personal income and personal spending both rose 0.3% MOM. Meanwhile, initial jobless claims ticked up and continuing claims came in lower than projected. The Dow was down 0.7%, while the tech-heavy Nasdaq Composite was little changed. The S&P 500 decreased 0.4% with nine of 11 sectors finishing in negative territory. The Communication Services sector was the top performer, rising 2.1%, while the Health Care sector was the bottom performer, falling 2.8%.
Technical analysis
As of midday Thursday, the S&P 500 is still in an uptrend. Support is at the 50-day and 200-day moving averages (6124 and 5899, respectively), while resistance is unknown.
On the data front, July’s nonfarm payrolls are expected to expand by 104,000 versus the prior month’s 147,000, while manufacturing payrolls are projected to show no change compared to the prior month’s decrease of 7,000. The unemployment rate is expected to tick up to 4.2% from the prior month’s 4.1%, while the labor force participation rate is expected to remain steady at 62.3%. Average hourly earnings are projected to rise 0.3% MOM and 3.8% YOY for July, compared to the prior month’s increases of 0.2% and 3.7%, respectively. The finalized reading of S&P Global’s manufacturing PMI for July is expected to come in at 49.7, slightly up from the previous reading of 49.5. ISM’s manufacturing PMI and prices paid component for July are expected to come in at 49.5 and 70.0, respectively, versus the prior month’s reading of 49.0 and 69.7, respectively. Construction spending is projected to show little change MOM in June, versus the prior month’s decrease of 0.3%. The finalized July reading of consumer sentiment from the University of Michigan is expected to come in at 62.0 versus the prior reading of 61.8, while one-year and 5-10-year inflation expectations are expected to come in at 4.4% and 3.6%, respectively, similar to the prior readings.
Across the pond, European stocks are lower in mid-day trading as the U.K.’s preliminary July Consumer Price Index (CPI) remained unchanged, with the headline and core readings showing increases of 2.0% and 2.3% YOY, respectively. Meanwhile, Germany’s preliminary July CPI rose 2.0% YOY and 0.3% MOM. The eurozone’s finalized manufacturing PMIs for July remained steady while the U.K.’s was revised slightly lower, with both remaining in contractionary territory. British house prices rose more than expected in July.
Overnight in Asia, stocks were mostly lower as China’s private July manufacturing PMI from S&P Global dropped more than expected, falling just into contractionary territory. South Korea’s manufacturing PMI for July fell further into contractionary territory. Meanwhile, the country’s trade surplus narrowed less than forecasted in July, following imports registering a smaller-than-expected increase and exports rising more than projected. Australia’s Producer Price Index rose by 0.7% quarter-over-quarter (QOQ) and 3.4% YOY for the second quarter. Japan’s jobless rate remained steady at 2.5%.
In FOREX trading, the dollar is slightly higher following the recent tariff updates.
Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.3% lower at $69.07/barrel.
In the metals complex, gold is little changed at $3,292.00/ounce.